We should learn a lot about the true intentions of the current move higher in USD/CAD over the next day or two. Our cyclical analysis suggests that if the rebound off the key support confluence area around 1.0650 has just been corrective then the exchange rate should turn back down around this time. Interestingly (as the chart above shows) this key moment in time is occurring right around an almost equally important price zone as the 200-day moving average, 2nd square root relationship of the month-to-date low, 1x1 Gann angle line of the year’s high and 61.8% retracement of the June decline all converge around 1.0820/30. If the pair is turning back down then these levels should probably hold. Strength through them (especially after Tuesday) would signal the move higher in USD/CAD has a lot more to run.

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved.